Benchmarks trade marginally higher in morning deals

In a choppy trading session, Indian equity benchmarks traded marginally higher in morning deals, led by gains in Auto, Realty, Consumer Discretionary and FMCG stocks. Traders took some support with State Bank of India (SBI) in its Ecowrap research report stated that the ongoing conflict between Ukraine and Russia is unlikely to have any major impact on the Indian rupee and the forex volatility in the country (USD/INR) has been much less now as compared to the global financial crisis which took place in 2008. Some support also came as industry body Retailers Association of India (RAI) stating that retail business in India grew 10 percent in February this year compared to the sales level in the same month last year, signaling that the sector is inching towards normalcy. However, gains remain capped as the government data showed retail inflation rose to 6.07 per cent in February mainly due to an uptick in food prices. The Consumer Price Index (CPI) based retail inflation was 5.03 per cent in February 2021 and 6.01 per cent in January. On the global front, Asian markets are trading mostly in red as surging Covid-19 cases in China hit the confidence of investors who are already worried about the Russia-Ukraine war.

The BSE Sensex is currently trading at 56540.43, up by 54.41 points or 0.10% after trading in a range of 56265.27 and 56720.60. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.77%, while Small cap index was up by 0.66%.

The top gaining sectoral indices on the BSE were Auto up by 2.12%, Realty up by 1.75%, Consumer Discretionary up by 1.00%, FMCG up by 0.91% and Industrials up by 0.90%, while Metal down by 2.46%, Oil & Gas down by 0.95%, IT down by 0.93%, TECK down by 0.77% and Energy down by 0.59% were the top losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 3.99%, Mahindra & Mahindra up by 2.85%, Ultratech Cement up by 1.70%, ICICI Bank up by 1.39% and Indusind Bank up by 1.32%. On the flip side, Tata Steel down by 2.74%, Infosys down by 1.72%, Kotak Mahindra Bank down by 0.91%, Tech Mahindra down by 0.80% and Power Grid Corporation down by 0.73% were the top losers.

Meanwhile, State Bank of India (SBI) in its Ecowrap research report has said that the ongoing conflict between Ukraine and Russia is unlikely to have any major impact on the Indian rupee and the forex volatility in the country (USD/INR) has been much less now as compared to the global financial crisis which took place in 2008. The report stated that though the conflict between the two CIS nations may drag on for now, it is expected that the USD/INR, the most tracked pair in the local forex market, will trade at an elevated zone. But ideally, the expected average range of the rupee is expected to be in the band Between Rs 76 to Rs 78 to the USD with an appreciated bias.

During the global financial crisis, the rupee had continued to decline and lost 13 per cent from January 2008 to July 2011. However, it mentioned that in the post-crisis period, the volatility had become significant (4.6 per cent) and INR declined 41 per cent between July 2011 and November 2013. However, this time the rupee volatility had been much less. It said the RBI has been active in the foreign exchange market and actively propping up the rupee.

Simultaneously, it said with foreign exchange intervention, also a part of inflation targeting, the rupee has been largely devoid of any serrated volatility which had worked favourably for the INR having an appreciating bias that has also helped keep the imported inflation in check. Such interventions creating liquidity is now also being managed by swaps to delay the liquidity impact of intervention. The central bank might look at the NFD (non-deliverable forward) market instead of the offshore market through banks during the Indian time zone, the report said, adding that this has the benefit of not impacting rupee liquidity. It will also reduce the arbitrage.

The CNX Nifty is currently trading at 16887.85, up by 16.55 points or 0.10% after trading in a range of 16807.65 and 16927.75. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Product up by 4.77%, Maruti Suzuki up by 3.54%, Mahindra & Mahindra up by 3.09%, Tata Motors up by 2.62% and Ultratech Cement up by 1.64%. On the flip side, ONGC down by 3.70%, Hindalco down by 3.17%, Tata Steel down by 2.72%, JSW Steel down by 2.49% and Infosys down by 1.74% were the top losers.

Asian markets are trading mostly in red; Hang Seng decreased 584.41 points or 2.99% to 18,947.25, Taiwan Weighted dropped 307.26 points or 1.78% to 16,955.78, Shanghai Composite declined 70.42 points or 2.18% to 3,153.11, Jakarta Composite lost 14.56 points or 0.21% to 6,937.64 and KOSPI fell 14.31 points or 0.54% to 2,631.34.

On the flip side, Straits Times advanced 20.77 points or 0.64% to 3,252.80 and Nikkei 225 surged 46.70 points or 0.18% to 25,354.55.